Philippine onions turn into gold nuggets, but who are the winners?
January 18, 2023
3 minutes
Onion: an indispensable ingredient in many kitchens. Including the Philippine one. But what if 1 kilogram of this tasty gem becomes more expensive than the wages of a day laborer? What is going on in the country where Philippine Airlines stewards try to smuggle in onions?
Food prices are skyrocketing everywhere, and the Philippines is no different. You now have to pay 700 pesos, or almost 12 euros, for 1 kilogram of onions. A year ago this was still 3,30 euros, which was already double the average onion price worldwide.
As early as August 2022, the Department of Agriculture warned that shortages were coming. The Philippines itself produces only 80% to 90% of consumption, which means that there will be shortages anyway. an annual deficit But unpredictable factors such as diseases, weather conditions - think of more intense typhoons due to climate change - or rising prices of, for example, pesticides are further increasing the shortage.
Families pay the price
The Ministry of Agriculture had already proposed to import onions, but Bongbong Marcos, the president and also the responsible Minister for Agriculture, did not want to hear of it. With the well-known consequences.
The average Filipino is paying the price for this decision by the president. But onions aren’t the only ones that have gone up. Earlier this year, there was also a price increase in pork due to swine fever. This was followed by price increases in fish, sugar and with the arrival of bird flu this year, it is predicted that chicken and eggs will also go up in price. This means that the average family currently spends a third of their budget on food.
Onion cartels
According to Hazel Tanchuling of the NGO Rice Watch Action Network, there is a small group of onion traders who keep prices artificially high and create scarcity by bringing limited stock to the market. “One thing we know for sure,” says Hazel, “the high price has nothing to do with the price farmers get from middlemen. The farmers don’t have storage space and are generally selling their produce at low prices, even during this price spike. If there was a price guarantee, farmers would have more incentive to grow more. So there is definitely work to be done for the government.”
In addition, it is no secret that many agricultural products, including onions, are smuggled into the country. Not a new phenomenon. There are Chinese networks that avoid customs or import products under forged documents, such as vegetables and ornamental plants. Less taxes are paid on this and, above all, large profits are made.
Need for structural measures
The record prices have certainly woken up quite a few members of parliament. Promises were made to investigate the matter. And a senator immediately brought up a 2013 study that did indeed show that there was an onion cartel operates that influences prices to make maximum profits.
In addition, President Marcos also launched the Kadiwa ng Pasko project in November 2022. That project offers farmers the opportunity to sell directly to consumers. In this way, both farmers and consumers are winners. Farmers because they themselves get a better price and the consumer because they pay less. Unfortunately, this initiative is not yet sufficient to counterbalance the commercial market.
However, Hazel from NGO Rice Watch Action Network - an international project partner of 11.11.11 - still opportunities: “Research is good and a project like Kadiwa also looks good. However, we will not solve these types of crisis situations without structural measures. The farmers are asking for better support from the government, such as storage space, road infrastructure and training. Only then can they build a dam against the cartels that are spoiling the onion market.
In the midst of all this commotion, the Marcos government also announced plans to import 21 tons of onions in early January. Good news for families, it sounds, but a nightmare for farmers' organizations because the harvest period, which peaks between February and May, is approaching. After all, imports will certainly bring down the price of their harvest. Will the farmer in the Philippines continue to plow?
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